What is bullion? How did bullion come into existence? What purpose does it serve? These are questions that many people ask when they come across the term bullion either consciously or subconsciously and there is only one suitable answer to all three questions, bullion is basically ‘real money’. Gold has been regarded as precious for eons and even with all the technology that humans have, finding and mining gold is an incredibly slow and arduous process. All in all, based on the latest approximate estimations a total of 160,000 tonnes of gold has been mined out of the Earth and although this may seem like a big number, the truth of the matter is 160,000 tonnes of gold can be cubed into a block it would be no bigger than a tennis court 3 meters tall.

No matter how we look at it, the fact is that gold is not consumed in any significantly meaningful sense as only a very negligible amount is used for false teeth due to its inertness and a little more is used in the electronics industry due to its non-corrosive characteristics and high conductivity level. More than 90 % of gold is used as jewellery and as a wealth store in bullion vaults. That is the gist of the entire ‘bullion dimension as even jewellery made out of gold is generally considered a private monetary reserve. The fact that gold is scarce is what makes it tangible if one was to compare it with money that can be printed as and when needed, making it practically worthless in some instances. Gold bullion on the other hand is limited and thus when only a certain amount of it is available its value can be determined fairly easily. In essence gold bullion acts as a bigger denomination of money whereas silver bullion acts as a smaller denomination which is akin to dollars and cents.

In other words gold’s restricted supply makes it perfect as a store value in comparison to paper money which is currently expanding out of control due to loose or unrestricted monetary policies that ensure the industries of the world keep chugging away. According to statistics paper money printing is expanding under political direction, by more than 10 % per annum and that is just for the Euro whereas the Americans are printing money much more incessantly. Towards the end if we were to look at this from a logical perspective, money will eventually be worthless. The fact that savers have observed gold’s reliable rarity is the reason why gold is a preferred money proxy when artificial forms of money are not restricted in supply which is against the principles of value, which can only be offered based on the rarity of an item such as gold, silver and other natural resources that are not abundant in supply. This is where the bullion comes in as a stand in for money when the current money systems collapse under the weight of their own debts as nations keep printing money almost irresponsibly. For more on gold bullion visit: https://www.bullionvault.com/guide/gold/Why-gold